BUSINESS OUTLOOK SEEN IMPROVING UNDER GLORIA II
MANILA, JUNE 28, 2004 (MALAYA) Britain's Standard Chartered Bank and Singapore's Standard and Poor's (S&P) Ratings Services have expressed positive outlooks for the economy following the proclamation of Arroyo.
Despite prevailing political uncertainties, the two foreign groups said the President's fresh mandate and promise of reforms are expected to usher in a gradual consolidation of the domestic political climate.
"This will enable her new administration to address pressing fiscal and reform issues, which is necessary to put public finances on an even keel and elevate the country's long-term growth potential," S&P said in a statement.
A large-scale popular unrest, according to the Singaporean firm, is unlikely and that a June 30 inauguration appeared assured, "removing the threat of a constitutional crisis that would have resulted had the election outcome not been proclaimed before then."
"With her election, expectations are high on Ms. Arroyo to now deliver political stability and higher growth, with a feeling of her having to prove to the electorate that her relative lack of success in her previous three years in office was due to distractions from her lack of an election mandate, the military mutiny, the unwieldy Congress, and rebel activity in the South," S&P said.
Tycoon Lucio Tan shared the view of the two firms, saying he is optimistic of better prospects for the economy under Arroyo.
After predicting sometime ago that the peso could depreciate considerably against the dollar, Tan said he expects the peso to recover to P50 to the dollar this year.
"I am optimistic. It will go back to P50 very soon. This could be within the year," he said.
Bangko Sentral agreed wit Tan, saying the next government just needs a good economic platform to restore investor confidence.
"If we have a good economic program in place, there is no reason why the peso shouldn't appreciate to P50 to the dollar," BSP Gov. Rafael Buenaventura said.
Mike Moran, Standard Chartered Bank regional economist for global research, the Philippine economy is likely to grow 4.7 percent this year and the peso to appreciate to P54 to the dollar.
The government itself targets a GDP growth rate of at least 4.9 percent for the year while the Asian Development Bank forecasts as high as 5.5 percent.
Reported by: Sol Jose Vanzi
© Copyright, 2004
by PHILIPPINE HEADLINE NEWS ONLINE
All rights reserved
PHILIPPINE HEADLINE NEWS ONLINE [PHNO] WEBSITE